Financing Youth Entrepreneurship in a Developing Country

Abstract

This paper is a contribution to the sparse scholarly literature on youth entrepreneurship in Latin America and the Caribbean. Uniquely, it provides a case study on financing youth entrepreneurship in the developing country of Guyana, both from the standpoint of youth entrepreneurs and the agencies that provide such funding. Based on a review of literature we developed a six-fold typology of sources of youth entrepreneurship financing in developing countries. The utility of this typology is that it enables identification of stakeholders for youth entrepreneurship financing in a country or community. This paper is derived from a broader case study of the factors impacting youth entrepreneurship in the town of Linden, Guyana. Its objectives are to identify the sources for youth entrepreneurship financing; determine the profile of youth entrepreneurs who access loans and grants for business start-up and expansion; and, explicate the problems agencies report in providing financing for youth entrepreneurs in Guyana. We obtained data from a survey of youth entrepreneurs in Guyana; agency interviews with governmental, non-governmental and other entities supporting youth entrepreneurship; and, secondary sources. Among the findings are that: 77% of youth entrepreneurs surveyed sourced capital for business start-up from their personal savings and/or family and friends. Some agencies from which youth entrepreneurs derived funds were less than sanguine about youths’ entrepreneurial prospects; and, programs supporting youth entrepreneurship were not coordinated, scattered across different levels of government and other agencies, did not evidence a common purpose and were advertised inadequately. Invariably, these agencies lacked adequate funding and were inconsistent in their delivery of financial support for youth businesses.